After scrapping oil capacity expansion plans earlier this year, Saudi state oil giant Aramco is now poised to boost natural gas output by 60% by 2030, Reuters reports, citing an Aramco executive on the sidelines of the Houston CERAWeek energy conference.
In the third quarter of last year, Saudi Arabia made two significant natural gas discoveries in two fields in the Empty Quarter, along with the discovery of five reservoirs in previously discovered fields.
At the Al-Hiran field, gas flowed at a rate of 30 million cubic feet daily. At the Al-Mahakik field, the gas flow was 0.85 million cubic feet daily.
Demand for gas is seen increasing significantly amid a global energy transition, which has prompted Saudi Arabia to move more quickly to open up the development of unconventional natural gas fields. LNG demand is expected to grow by 50% by 2030.
The Saudis’ growing interest in natural gas has also led to the Kingdom’s first acquisition in the LNG space earlier this year.
Earlier this month, Reuters cited unnamed sources as saying that Aramco and Abu Dhabi National Oil Company (ADNOC) are in talks to invest in American LNG in order to compete with Qatar, which lost its ranking to the U.S. in January as the world’s largest LNG exporter.
Aramco is reportedly in talks concerning the Sempra Infrastructure Port Arthur LNG Phase 2 project in Texas. Phase 1 is already producing, while Phase 2 has been proposed for expansion.
The Saudi quest to expand its natural gas production capacity, along with its increasing interest in global LNG options, comes as the Biden Administration continues with a pause in approvals for new LNG projects imposed in January and adding uncertainty to new project financing for American LNG players.
By Charles Kennedy for Oilprice.com
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